You'll need to be running some sort of X windows server or session on whatever box you want the display to come up on. When you ssh in (or connect via a pseudo terminal) the DISPLAY variable won't matter.
For a simple your-pc setup, download some freeware Xwindows software, start it running on your PC and note the display setting (probably your PC's IP:0.0)
Then on the host you ssh to, do (not all may be necessary)
export DISPLAY=10.10.10.10:0.0 <-- or whatever IP your display is on.
Then you should be able to run X apps, window managers, etc from the ssh/terminal prompt.
Hope that helps